In the charity world, Robert Egger is something of a rabble rouser, issuing frequent and well-informed calls for reform of the nonprofit system. As the founder and president of the D.C. Central Kitchen, which feeds the hungry while training the unemployed, Egger has the street cred to back up his often pointed criticisms. He has also served as interim chief of the D.C. area United Way and is the author of Begging for Change: The Dollars and Sense of Making Nonprofits Responsive, Efficient, and Rewarding for All (HarperCollins, 2004). His latest venture is the V3 Campaign, which aims to tap the economic and political power of nonprofits.

Now that we’re in a full-bore recession, needs for charity services are up just as donations are sharply down. What does this mean for the charity world?

It could easily be seen as a one-two punch. A significant number of our colleagues are going to be down on one knee. What I’ve been trying to stir up over the past three years, first with the Nonprofit Congress and then with the subsequent V3 Campaign, was to say, in effect, look, there were certain things you could see coming quite a distance off. Maybe not this significant recession we’re in the middle of. But you could see state budgets being constricted. Politicians were going to have to make serious cuts. What we were trying to anticipate and head off at the pass were understandable but intellectually flawed concepts about the smart places to make cuts—things we can somehow do without.

This is where nonprofits are stuck right now, because what you’re seeing is cuts in funding for Medicaid and Medicare, prisoner reentry programs, arts programs, things that are viewed as extras: “It’s too bad, but we’ll just have to do without that for a year or two.” Many of us have been trying to help people understand that these have real economic impact. Business isn’t the only place within our communities in which currencies are created.

Could the recession be a positive force that causes nonprofits to refocus on their missions and be more innovative with their resources?

Circumstances like these oftentimes create the perfect atmosphere for innovation. For example, there’s a lot of talk about mergers, and that’s not an illegitimate discussion. I’m of the idea that if we merge our voices, our assets, we could be a tremendous force in any community. This might prove to be a real breakthrough time for people to realize we have more to gain by staying together than by taking the kind of balkanized route we’ve historically taken.

If we just act as if we have to somehow weather the storm on our own, I think that’s part of the flawed thinking of the separation of government, nonprofit, and for-profit. Part of me recoils at saying you have to choose between a dot-com and a dot-org. I’m a big believer in the hybrid, that there’s something out there that’s in between. And there are lots of amazingly good experiments. But if we just sit back and say, “Wow, all these different resources are down, what are we going to do, woe is us,” we’re going to get more of the same.

Nonprofits were already facing other challenges before the recession came along, weren’t they?

Yes. Donations of products, whether it’s food or building materials, were decreasing dramatically over the past few years, just because industry standards have shifted. There’s a greater sense of inventory control than there was in the 1970s and 1980s.

You could also predict that a significant amount of individual giving would decline, just because people were getting worn out by the perception that nonprofits are somehow out of control and all over the place. The only news the vast majority of Americans get about nonprofits, outside of seasonal stories, is a steady drip of nonprofit scandal stories.

So all this stuff you could kind of see, but what I and a lot of other people have been trying to get out in front of is a consolidation of the nonprofit sector. I’ve said the sector would be more dynamic and robust if we had 25 percent fewer nonprofits. I think that’s going to happen anyway; we’re in the middle of it right now.

From an economic standpoint, it makes sense. There are nearly 2 million nonprofit organizations without any real standards that unite us or market forces that propel us forward. You’ve got a cacophony of goodwill. Flowers are blooming, and it’s not bad—I’m just interested in a garden. You don’t get that by tossing
seeds out the window hoping something grows. You get it by deliberately going out and tilling the field and planting it and weeding it and all that other good stuff.

The imperative question is: Is this consolidation going to be done intelligently, or is this survival of the cleverest? Who’s got the cause of the year, who’s got the prettiest ribbon this year, who’s willing to exploit a pitiful image more than the other person? I recoil at seeing that this is what our business has become. We compete with each other for the leftovers of America’s table based on ploys like these. That’s why the imperative right now is to develop a new set of metrics that will allow the public in particular to tell which organizations can deliver on their promises, and who’s just pitching empty words.

You’ve suggested that the baby boomers have a chance to redeem themselves by doing good works. Tell me more about this.

There’s probably a 70 percent chance that the vast majority of boomers are going to reach old age and say, “Hey, where’s my Social Security, where’s my retirement? I want to sit back and relax.”

They’re going to expect a lot from government, but we can’t just let people consume. They need to produce something, so the boomers must be actively engaged in the community. Already you can see a wave of people coming who are looking in the mirror and not liking the reflection too much. They’re thinking, I heard John Lennon and Marvin Gaye and Martin Luther King with my own ears. How did I stray so far from the garden? How did I think that if I just bought more junk, I’d be happy?

This is a once-in-a-millennium shot, to have potentially 80 million baby boomers, and a large hunk of them looking for a way to redeem themselves, be involved, or make a difference. And at the same time, you have people coming out of universities, the millennials, people who were born between 1980 and 2001, and there’s 80 million of them, and we’ve raised them doing community service. So you’ve got 160 million people who could potentially be looking for some way to make a difference in their community. That’s energy. Let’s view it as a new form of energy in America. To me, that’s the kind of thinking that takes us one step beyond this charity model.

If you study American history, you can see over the past 75 years that so many things—music, fashion, science, dance—have shifted a million times over. Yet in so many cases, charity has stayed the same. We still genuflect to the notion that people make money in life and somewhere near the end of it they decide to give some back, oftentimes trying to offset the damage they did making a bunch of money. I’m intensely curious about whether this is the only way to do this. This is one of the most exciting times that we’ve had in the nonprofit sector in the past 25 years because it’s going to force many of us to evolve.